Part 4: Investigation and prosecution

Guidance for members of local authorities about the local authorities (Members' Interests) Act 1968.

The Act is enforced by prosecution. The Auditor-General is the sole prosecuting authority.


There are two offences under the Act, as shown in Figure 1.

Figure 1
Offences under the Local Authorities (Members' Interests) Act 1968

Section Offence Penalty on conviction
5 Continuing to act as a member after becoming disqualified from office, by reason of a breach of the contracting limit under section 3(1). A fine not exceeding $200.
7 Failing to observe the prohibition in section 6(1) against discussing or voting on a matter in which the member has a pecuniary interest. A fine not exceeding $100 and, if the conviction is not successfully appealed, automatic disqualification from office.

Proceedings must begin within two years of the offence being committed.

Deciding whether to investigate

We may investigate a possible breach of the Act or related offence either on receipt of a complaint or at our own discretion.

To investigate a complaint, we must first be satisfied that there is enough evidence to justify an investigation. A bare allegation or simple assertion that there has been a breach is not enough.

A complaint should be supported with enough evidence to demonstrate that the complaint warrants further investigation, such as:

  • details about the alleged pecuniary interest;
  • information about the decision taken by the relevant local authority and the member's participation in that decision; and
  • documentary evidence, such as minutes of the local authority's meeting where the decision was taken, and any supporting council reports.

Investigating possible breaches

Any member of the public may complain or raise questions about your compliance with the Act. However, both the investigation and the final resolution of the matter are primarily between you and us.

Where a complaint is made to us that you may have breached the Act, and we decide that it warrants further investigation, we will give you full details of the complaint and an opportunity to respond to it. However, we do not disclose the identity of a person who makes a complaint. This is consistent with the approach taken by all prosecuting agencies. It is important that members of the public feel free to provide information about possible offences, without fear of their identity being disclosed.

We will investigate the complaint carefully to ascertain the relevant facts and to evaluate whether there has been a breach of the Act. This involves considering whether the factual circumstances disclose a breach, and whether any of the exclusions or defences can be relied on.

We will also seek information about the broader context of the complaint, including your reasons for acting as you did, your understanding of the nature of your interest in the matter and the general context, and the other matters you took into account.

Although we will give you full details of the complaint and an opportunity to respond to it, you do not have a formal right to be consulted about whether criminal charges are laid or not. However, we carefully consider whether to prosecute (see paragraphs 4.17-4.21) and take external advice from the Crown Law Office or a Crown Solicitor before beginning any prosecution.

If an investigation does not result in a decision to prosecute, our usual practice is to:

  • inform the complainant (if there is one) that we have completed our enquiries; and
  • convey our findings in writing to you.

We may also inform the authority of our findings.

We have a discretion as to how much of our investigation we publicly report, and we carefully consider this in each case. We consider the balance between effects on a member's reputation, effects of disclosing personal financial information of the member, public accountability, and the public interest. Because the balance of these factors will differ in each case, we decide on a case-by-case basis how much of our investigation we will publicly report.

We note that in some cases it better serves the public interest for us to report more fully on our investigations and conclusions.11 This is particularly so where we have investigated publicly made allegations of breaches of the Act that have attracted considerable local public interest.

In such cases, therefore, as well as reporting our findings to you and your authority, we may also make a brief public statement about our investigation and findings. You are then accountable to the public for your conduct.

Deciding whether to prosecute

If we consider the circumstances warrant it, we may begin proceedings. This involves the exercise of discretion. The need to even consider prosecution is a matter of serious concern. However, in any particular situation, we may form the view that, although an offence appears to have been committed, the circumstances do not warrant prosecution.

In exercising our discretion, we take account of the Solicitor-General's Prosecution Guidelines issued by the Crown Law Office.12 These guidelines are the accepted and authoritative description of how any prosecuting agency should exercise its discretion.

These guidelines require both that the facts provide evidence of a breach of the Act and that it is in the public interest to bring a prosecution.

There must be a reasonable prospect of obtaining a conviction – there must be credible evidence that can be relied on in court to reasonably expect that a judge will convict. The burden of proof for criminal prosecutions is stricter than the test required to invalidate an authority's decision in judicial review proceedings for bias. As well as needing to establish that there has been a breach, it must be clear that none of the exclusions or defences in the Act apply.

Even if there is evidence that can establish a breach, the public interest in any prosecution must also be considered. Factors relevant to that assessment include:

  • whether it is more likely than not that a prosecution will result in conviction;
  • the size and immediacy of any pecuniary interest, the damage caused, the level of public concern, and the extent to which the member's participation influenced the outcome;
  • mitigating and aggravating factors, including any previous misconduct, willingness to co-operate with an investigation, evidence of recklessness or irresponsibility, and previous breaches, cautions, and warnings;
  • the effect of a decision not to prosecute on public opinion;
  • the availability of proper alternatives to prosecution, such as reporting publicly to the council or the public;
  • the prevalence of the offending and need for deterrence;
  • whether the consequences of a conviction would be unduly harsh or oppressive; and
  • the likely length and expense of the trial.

This list is illustrative only and is not exhaustive.

11: See, for example, our Investigation into conflicts of interest of four councillors at Environment Canterbury(December 2009), which is available on our website.

12: Crown Law Prosecution Guidelines (January 2010), available at

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